Document And Entity Information
Document And Entity Information - shares | 6 Months Ended | |
Jun. 30, 2015 | Aug. 07, 2015 | |
Document and Entity Information [Abstract] | ||
Entity Registrant Name | WIRELESS TELECOM GROUP INC | |
Document Type | 10-Q | |
Current Fiscal Year End Date | --12-31 | |
Entity Common Stock, Shares Outstanding | 19,626,455 | |
Amendment Flag | false | |
Entity Central Index Key | 878,828 | |
Entity Filer Category | Smaller Reporting Company | |
Document Period End Date | Jun. 30, 2015 | |
Document Fiscal Year Focus | 2,015 | |
Document Fiscal Period Focus | Q2 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) | Jun. 30, 2015 | Dec. 31, 2014 |
CURRENT ASSETS: | ||
Cash and cash equivalents | $ 9,742,037 | $ 10,723,513 |
Accounts receivable - net of allowance for doubtful accounts of $60,614 and $51,421 for 2015 and 2014, respectively | 6,008,613 | 5,106,241 |
Inventories | 9,065,085 | 8,541,077 |
Deferred income taxes - current | 1,051,269 | 2,026,269 |
Prepaid expenses and other current assets | 395,849 | 835,250 |
TOTAL CURRENT ASSETS | 26,262,853 | 27,232,350 |
PROPERTY, PLANT AND EQUIPMENT - NET | 1,746,251 | 1,689,289 |
OTHER ASSETS: | ||
Goodwill | 1,351,392 | 1,351,392 |
Deferred income taxes - non-current | 6,088,685 | 5,263,380 |
Other assets | 696,055 | 752,511 |
TOTAL OTHER ASSETS | 8,136,132 | 7,367,283 |
TOTAL ASSETS | 36,145,236 | 36,288,922 |
CURRENT LIABILITIES: | ||
Accounts payable | 1,489,288 | 1,185,230 |
Accrued expenses and other current liabilities | 471,378 | 1,307,043 |
Equipment leases payable - current | 69,869 | 134,230 |
TOTAL CURRENT LIABILITIES | 2,030,535 | 2,626,503 |
LONG TERM LIABILITIES: | ||
Deferred rent | $ 11,151 | |
Equipment leases payable | $ 32,054 | |
COMMITMENTS AND CONTINGENCIES | ||
SHAREHOLDERS’ EQUITY: | ||
Preferred stock, $.01 par value, 2,000,000 shares authorized, none issued | ||
Common stock, $.01 par value, 75,000,000 shares authorized, 29,640,891 and 29,510,891 shares issued, 19,626,455 and 19,496,455 shares outstanding, respectively | $ 296,409 | $ 295,109 |
Additional paid-in-capital | 39,724,351 | 39,530,325 |
Retained earnings | 13,402,031 | 13,124,172 |
Treasury stock at cost, 10,014,436 shares | (19,319,241) | (19,319,241) |
TOTAL SHAREHOLDERS’ EQUITY | 34,103,550 | 33,630,365 |
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY | $ 36,145,236 | $ 36,288,922 |
CONDENSED CONSOLIDATED BALANCE3
CONDENSED CONSOLIDATED BALANCE SHEETS (Parentheticals) - USD ($) | Jun. 30, 2015 | Dec. 31, 2014 |
Allowance for doubtful accounts (in Dollars) | $ 60,614 | $ 51,421 |
Preferred stock, par value (in Dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 2,000,000 | 2,000,000 |
Preferred stock, shares issued | ||
Common stock, par value (in Dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 75,000,000 | 75,000,000 |
Common stock, shares issued | 29,640,891 | 29,510,891 |
Common stock, shares outstanding | 19,626,455 | 19,496,455 |
Treasury stock, shares | 10,014,436 | 10,014,436 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | |
NET SALES | $ 8,213,297 | $ 10,438,916 | $ 16,840,988 | $ 19,624,247 |
COST OF SALES | 4,646,812 | 5,509,144 | 9,410,853 | 10,428,575 |
GROSS PROFIT | 3,566,485 | 4,929,772 | 7,430,135 | 9,195,672 |
OPERATING EXPENSES | ||||
Research and development | 956,465 | 918,109 | 1,872,901 | 1,679,100 |
Sales and marketing | 1,342,033 | 1,432,005 | 2,687,438 | 2,699,219 |
General and administrative | 1,120,093 | 1,311,281 | 2,383,175 | 2,746,927 |
TOTAL OPERATING EXPENSES | 3,418,591 | 3,661,395 | 6,943,514 | 7,125,246 |
OPERATING INCOME | 147,894 | 1,268,377 | 486,621 | 2,070,426 |
OTHER (INCOME) EXPENSE - NET | 300 | 7,490 | (2,966) | 37,829 |
NET INCOME BEFORE INCOME TAXES | 147,594 | 1,260,887 | 489,587 | 2,032,597 |
PROVISION FOR INCOME TAXES | 63,589 | 544,974 | 211,728 | 876,707 |
NET INCOME | $ 84,005 | $ 715,913 | $ 277,859 | $ 1,155,890 |
INCOME PER COMMON SHARE: | ||||
BASIC (in Dollars per share) | $ 0 | $ 0.04 | $ 0.01 | $ 0.05 |
DILUTED (in Dollars per share) | $ 0 | $ 0.03 | $ 0.01 | $ 0.05 |
CONDENSED CONSOLIDATED STATEME5
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) | 6 Months Ended | |
Jun. 30, 2015 | Jun. 30, 2014 | |
CASH FLOWS (USED FOR) PROVIDED BY OPERATING ACTIVITIES | ||
Net income | $ 277,859 | $ 1,155,890 |
Adjustments to reconcile net income to net cash (used for) provided by operating activities: | ||
Depreciation and amortization | 223,755 | 236,808 |
Share-based compensation expense | 171,926 | 80,533 |
Deferred rent | 11,151 | |
Deferred income taxes | 149,695 | 655,712 |
Provision for doubtful accounts | 9,193 | (51,799) |
Inventory reserves | 52,973 | |
Changes in assets and liabilities: | ||
Accounts receivable | (911,565) | (1,789,160) |
Inventories | (524,008) | (248,456) |
Prepaid expenses and other assets | 495,857 | (102,734) |
Accounts payable | 304,058 | 735,398 |
Accrued expenses and other current liabilities | (836,203) | (154,813) |
Net cash (used for) provided by operating activities | (628,282) | 570,352 |
CASH FLOWS (USED) BY INVESTING ACTIVITIES | ||
Capital expenditures | (280,717) | (196,954) |
CASH FLOWS (USED) BY FINANCING ACTIVITIES | ||
Proceeds from exercise of stock options | 23,400 | 93,600 |
Repayments of equipment lease payable | (95,877) | (60,052) |
Repurchase of common stock - 0 and 4,815,110 shares, respectively | (9,630,219) | |
Net cash (used for) financing activities | (72,477) | (9,596,671) |
NET (DECREASE) IN CASH AND CASH EQUIVALENTS | (981,476) | (9,223,273) |
Cash and cash equivalents, at beginning of period | 10,723,513 | 16,599,249 |
CASH AND CASH EQUIVALENTS, AT END OF PERIOD | 9,742,037 | 7,375,976 |
SUPPLEMENTAL INFORMATION: | ||
Cash paid during the period for income taxes | $ 63,762 | 405,500 |
SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES: | ||
Capital expenditures | (149,432) | |
Equipment lease payable | $ 149,432 |
CONDENSED CONSOLIDATED STATEME6
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Parentheticals) - shares | 6 Months Ended | |
Jun. 30, 2015 | Jun. 30, 2014 | |
Common stock repurchase, shares | 0 | 4,815,110 |
CONDENSED CONSOLIDATED STATEME7
CONDENSED CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY - 6 months ended Jun. 30, 2015 - USD ($) | Common Stock [Member] | Additional Paid-in Capital [Member] | Retained Earnings [Member] | Treasury Stock [Member] | Total |
Balances at Dec. 31, 2014 | $ 295,109 | $ 39,530,325 | $ 13,124,172 | $ (19,319,241) | $ 33,630,365 |
Balances, Shares (in Shares) at Dec. 31, 2014 | 29,510,891 | 19,496,455 | |||
Net income | 277,859 | $ 277,859 | |||
Stock issued under equity compensation plan | $ 1,300 | (1,300) | |||
Stock issued under equity compensation plan (in Shares) | 130,000 | ||||
Stock options exercised | 23,400 | 23,400 | |||
Share-based compensation expense | 171,926 | 171,926 | |||
Balances at Jun. 30, 2015 | $ 296,409 | $ 39,724,351 | $ 13,402,031 | $ (19,319,241) | $ 34,103,550 |
Balances, Shares (in Shares) at Jun. 30, 2015 | 29,640,891 | 19,626,455 |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING PRINCIPLES AND POLICIES | 6 Months Ended |
Jun. 30, 2015 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies [Text Block] | NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING PRINCIPLES AND POLICIES The condensed consolidated balance sheet as of June 30, 2015, the condensed consolidated statements of operations for the three and six-month periods ended June 30, 2015 and 2014, the condensed consolidated statements of cash flows for the six-month periods ended June 30, 2015 and 2014, and the condensed consolidated statement of shareholders’ equity for the six-month period ended June 30, 2015 have been prepared by the Company without audit. The condensed consolidated financial statements include the accounts of Wireless Telecom Group, Inc., which operates one of its product lines under the trade name Noisecom, Inc. (“Noisecom”), and its wholly-owned subsidiaries Boonton Electronics Corporation (“Boonton”), Microlab/FXR (“Microlab”), WTG Foreign Sales Corporation and NC Mahwah, Inc., which are collectively referred to herein as, the “Company”. All intercompany transactions and balances have been eliminated in consolidation. In the opinion of management, the accompanying condensed consolidated financial statements referred to above contain all necessary adjustments, consisting of normal accruals and recurring entries, which are necessary to fairly present the Company’s results for the interim periods being presented. The accounting policies followed by the Company are set forth in Note 1 to the Company’s financial statements included in its annual report on Form 10-K for the year ended December 31, 2014. Specific reference is made to that report since certain information and footnote disclosures normally included in financial statements in accordance with accounting principles generally accepted in the United States of America (US GAAP) have been condensed or omitted from this report. The preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities (including inventory valuation, accounts receivable valuation, valuation of deferred tax assets and estimated fair values of stock options) and disclosure of contingent assets and liabilities at the date of the financial statements and reported amounts of net sales and expenses during the reporting period. Actual results could differ from those estimates. The results of operations for the three and six-month periods ended June 30, 2015 are not necessarily indicative of the results to be expected for the full year ending December 31, 2015. Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of cash and accounts receivable. The Company maintains significant cash investments primarily with two financial institutions, which at times may exceed federally insured limits. The Company performs periodic evaluations of the relative credit rating of these institutions as part of its investment strategy. The Company has limited concentration of credit risk in accounts receivable due to the large number of entities comprising our customer base and their dispersion across many different industries and geographies. Credit evaluations are performed on customers requiring credit over a certain amount. Credit risk is mitigated to a lesser extent through collateral such as letters of credit, bank guarantees or payment terms like cash in advance. Credit evaluation is performed independent of the Company’s sales team to ensure segregation of duties. For the three and six-months ended June 30, 2015, 0 customer accounted for 10% or more of the Company’s consolidated sales. For the three and six-months ended June 30, 2014, one customer accounted for 13% and 14% of the Company’s consolidated sales, respectively. At June 30, 2015, 0 customer represented 10% or more of the Company’s gross accounts receivable. However, at December 31, 2014, one customer represented 11% of the Company’s gross accounts receivable balance. The carrying amounts of cash and cash equivalents, trade receivables, other current assets and accounts payable approximate fair value due to the short-term nature of these instruments. The Company considers all highly liquid investments purchased with maturities of three months or less at the time of purchase to be cash equivalents. Cash and cash equivalents consist of bank and money market accounts. Management has evaluated subsequent events and determined that there were no subsequent events or transactions requiring recognition or disclosure in the condensed consolidated financial statements through the date the financial statements were issued. |
RECENT ACCOUNTING PRONOUNCEMENT
RECENT ACCOUNTING PRONOUNCEMENTS | 6 Months Ended |
Jun. 30, 2015 | |
Accounting Changes and Error Corrections [Abstract] | |
Accounting Changes and Error Corrections [Text Block] | NOTE 2 – RECENT ACCOUNTING PRONOUNCEMENTS In July 2015, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2015-11, “Simplifying the Measurement of Inventory.” ASU 2015-11 applies to inventory that is measured using first-in, first-out (FIFO) or average cost. An entity should measure inventory within the scope of ASU 2015-11 at the lower of cost and net realizable value. Net realizable value is the estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal and transportation. The amendments in ASU 2015-11 more closely align the measurement of inventory in US GAAP with the measurement of inventory in International Financial Reporting Standards (IFRS). ASU 2015-11 is effective for fiscal years beginning after December 15, 2016. The Company is in the process of evaluating the impact of ASU 2015-11 on its consolidated financial statements. On April 17, 2015, the FASB issued ASU 2015-03, “ Simplifying the Presentation of Debt Issuance Costs.” requires debt issuance costs to be presented in the balance sheet as a direct deduction from the associated debt liability. Currently, debt issuance costs are recorded as an asset and amortization of these deferred financing costs is recorded in interest expense. Under the new standard, debt issuance costs will continue to be amortized over the life of the debt instrument and amortization will continue to be recorded in interest expense. The new standard is effective for the Company on January 1, 2016 and will be applied on a retrospective basis. The Company does not expect the adoption of ASU 2015-03 to have a material impact on its consolidated financial statements. In June 2014, the FASB issued ASU 2014-12, Compensation-Stock Compensation (Topic 718): Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved after the Requisite Service Period - Consensus of the FASB Emerging Issues Task Force In May 2014, the FASB issued ASU 2014-09 “Revenue from Contracts with Customers” (Topic 606) (“ASU 2014-09”). ASU 2014-09 is a comprehensive new revenue recognition model requiring a company to recognize revenue to depict the transfer of goods or services to a customer at an amount reflecting the consideration it expects to receive in exchange for those goods or services. In July 2015, the FASB deferred the effective date for annual reporting periods beginning after December 15, 2017 (including interim reporting periods within those periods). Early adoption is permitted to the original effective date of December 15, 2016 (including interim reporting periods within those periods). The amendments may be applied retrospectively to each prior period presented or retrospectively with the cumulative effect recognized as of the date of initial application. The Company is currently in the process of evaluating the impact the adoption of ASU 2014-09 will have on the Company’s consolidated financial statements, but does not expect the impact to be material. Management does not believe that any other recently issued, but not yet effective accounting pronouncements, if adopted, would have a material impact on the accompanying condensed consolidated financial statements. |
INCOME TAXES
INCOME TAXES | 6 Months Ended |
Jun. 30, 2015 | |
Income Tax Disclosure [Abstract] | |
Income Tax Disclosure [Text Block] | NOTE 3 – INCOME TAXES The Company records deferred taxes in accordance with Accounting Standards Codification (“ASC”) 740, “Accounting for Income Taxes.” ASC 740 requires recognition of deferred tax assets and liabilities for temporary differences between tax basis of assets and liabilities and the amounts at which they are carried in the financial statements, based upon the enacted rates in effect for the year in which the differences are expected to reverse. The Company establishes a valuation allowance when necessary to reduce deferred tax assets to the amount expected to be realized. The Company periodically assesses the value of its deferred tax assets and determines the necessity for a valuation allowance. The Company has a domestic net operating loss carryforward at June 30, 2015 of approximately $17,000,000 which expires in 2029. The Company also has a German net operating loss carryforward at June 30, 2015 of approximately $23,400,000. Realization of the Company’s deferred tax assets is dependent upon the Company generating sufficient taxable income in the appropriate tax jurisdictions in future years to obtain benefit from the reversal of net deductible temporary differences and from utilization of net operating losses. The Company’s valuation allowance of $7,012,134 is associated with the Company’s German net operating loss carryforward from an inactive German entity. The amount of deferred tax assets considered realizable is subject to adjustment in future periods if estimates of future taxable income are changed. As of June 30, 2015, management believes that it is more likely than not that the Company will fully realize the benefits of its deferred tax asset associated with its domestic net operating loss carryforward. The deferred income tax assets and (liabilities) are summarized as follows: June 30, December 31, 2015 2014 Net deferred tax asset: Uniform capitalization of inventory costs for tax purposes $ 172,470 $ 168,119 Reserves on inventories 414,898 414,898 Allowance for doubtful accounts 24,246 20,568 Accruals — 240,000 Tax effect of goodwill (489,505 ) (471,487 ) Book depreciation over tax (11,329 ) (17,699 ) Net operating loss carryforward 14,041,308 13,947,384 14,152,088 14,301,783 Valuation allowance for deferred tax assets (7,012,134 ) (7,012,134 ) $ 7,139,954 $ 7,289,649 Under ASC 740, the Company must recognize the tax benefit from an uncertain position only if it is more-likely-than-not the tax position will be sustained on examination by the taxing authority, based on the technical merits of the position. The tax benefits recognized in the financial statements attributable to such position are measured based on the largest benefit that has a greater than 50% likelihood of being realized upon the ultimate resolution of the position. The components of income tax expense related to income from operations are as follows: Three Months Ended Six Months Ended June 30, Jun 30, 2015 2014 2015 2014 Current: Federal $ 2,826 $ 17,062 $ 17,457 $ 33,805 State 13,292 116,825 44,576 187,190 Deferred: Federal 41,442 350,234 134,717 571,025 State 6,029 60,853 14,978 84,687 $ 63,589 $ 544,974 $ 211,728 $ 876,707 The Company has analyzed its filing positions in all of the Federal and state jurisdictions where it is required to file income tax returns. As of June 30, 2015 and December 31, 2014, the Company has identified its Federal tax return and its state tax return in New Jersey as “major” tax jurisdictions, as defined, in which it is required to file income tax returns. Based on the evaluations noted above, the Company has concluded that there are no significant uncertain tax positions requiring recognition or disclosure in its condensed consolidated financial statements. |
INCOME PER COMMON SHARE
INCOME PER COMMON SHARE | 6 Months Ended |
Jun. 30, 2015 | |
Earnings Per Share [Abstract] | |
Earnings Per Share [Text Block] | NOTE 4 - INCOME PER COMMON SHARE Basic earnings per share is calculated by dividing income available to common shareholders by the weighted average number of shares of common stock outstanding during the period. Diluted earnings per share are calculated by using the weighted average number of shares of common stock outstanding and, when dilutive, potential shares from stock options and warrants to purchase common stock, using the treasury stock method. Three Months Ended Six Months Ended 2015 2014 2015 2014 Weighted average common shares outstanding 19,524,258 19,731,302 19,510,434 21,870,382 Potentially dilutive stock options 834,984 1,108,511 1,045,116 1,262,150 Weighted average common shares outstanding, assuming dilution 20,359,242 20,839,813 20,555,550 23,132,532 Common stock options are included in the diluted earnings per share calculation when the various option exercise prices are less than their relative average market price during the periods presented in this quarterly report. The weighted average number of shares of common stock underlying options not included in diluted earnings per share, because the effects are anti-dilutive, was 1,727,192 and 1,729,039 for the three-months ended June 30, 2015 and 2014, respectively. For the six-months ended June 30, 2015 and 2014, the weighted average number of shares of common stock underlying options not included in diluted earnings per share was 1,522,742 and 1,596,784, respectively. |
INVENTORIES
INVENTORIES | 6 Months Ended |
Jun. 30, 2015 | |
Inventory Disclosure [Abstract] | |
Inventory Disclosure [Text Block] | NOTE 5 – INVENTORIES Inventory carrying value is net of inventory reserves of $1,037,247 at June 30, 2015 and December 31, 2014. June 30, December 31, 2015 2014 Inventories consist of: Raw materials $ 4,403,459 $ 4,161,734 Work-in-process 788,160 735,364 Finished goods 3,873,466 3,643,979 $ 9,065,085 $ 8,541,077 |
GOODWILL
GOODWILL | 6 Months Ended |
Jun. 30, 2015 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets Disclosure [Text Block] | NOTE 6 - GOODWILL Goodwill represents the excess of the aggregate purchase price over the fair value of the net assets acquired in a purchase business combination. Goodwill is not amortized but rather is reviewed for impairment at least annually or more frequently if a triggering event occurs. Management first makes a qualitative assessment of whether it is more-likely-than-not that a reporting unit’s fair value is less than its carrying amount before applying the two-step goodwill impairment test described below. If, based on the qualitative assessment, the estimated fair value is well in excess of its carrying amount, management will not perform a quantitative assessment. If, however, the conclusion is that it is more likely than not that the fair value of a reporting unit is less than its carrying amount, management then performs a two-step goodwill impairment test. Under the first step, the fair value of the reporting unit is compared with its carrying value, and, if an indication of goodwill impairment exists for the reporting unit, the Company must perform step two of the impairment test (measurement). Under step two, an impairment loss is recognized for any excess of the carrying amount of the reporting unit’s goodwill as determined by allocating the fair value of the reporting unit in a manner similar to a purchase price allocation. The residual fair value after this allocation is the implied fair value of the reporting unit’s goodwill. The Company’s goodwill balance of $1,351,392 at June 30, 2015 and December 31, 2014 relates to one of the Company’s reporting units, Microlab. Management’s qualitative assessment performed in the fourth quarter of 2014 did not indicate any impairment of Microlab’s goodwill as its fair value is estimated to be in excess of its carrying value. Furthermore, no events have occurred since then that would change this assessment. |
ACCOUNTING FOR SHARE BASED COMP
ACCOUNTING FOR SHARE BASED COMPENSATION | 6 Months Ended |
Jun. 30, 2015 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Disclosure of Compensation Related Costs, Share-based Payments [Text Block] | NOTE 7 - ACCOUNTING FOR SHARE BASED COMPENSATION The Company follows the provisions of ASC 718, “Share-Based Payment.” The Company’s results for the three and six-month periods ended June 30, 2015 include share-based compensation expense totaling $85,963 and $171,926, respectively. Results for the three and six-month periods ended June 30, 2014 include share-based compensation expense totaling $22,649 and $80,533, respectively. Such amounts have been included in the Condensed Consolidated Statements of Operations within operating expenses. Incentive Compensation Plan: In 2012, the Company’s Board of Directors and shareholders approved the 2012 Incentive Compensation Plan (the “Initial 2012 Plan”), which provides for the grant of restricted stock awards, non-qualified stock options and incentive stock options in compliance with the Internal Revenue Code of 1986, as amended, to employees, officers, directors, consultants and advisors of the Company who are expected to contribute to the Company’s future growth and success. When originally approved, the Initial 2012 Plan provided for the grant of awards relating to 2,000,000 shares of common stock, plus those shares still available under the Company’s prior incentive compensation plan. In June 2014, the Company’s shareholders approved the Amended and Restated 2012 Incentive Compensation Plan (the “2012 Plan”) allowing for an additional 1,658,045 shares of the Company’s common stock to be available for future grants under the 2012 Plan. As of June 30, 2015, there were 2,169,000 shares available for issuance under the 2012 Plan, including those shares available under the Company’s prior incentive compensation plan as of such date. All service-based options granted have ten-year terms from the date of grant and vest annually and become fully exercisable after a maximum of five years. Performance-based options granted have ten-year terms and vest and become fully exercisable when determinable performance targets are achieved. Performance targets are agreed to, and approved by, the Company’s Board of Directors. Provisions of the 2012 Plan require that all awards that are stock options be made at exercise prices equal to or greater than the fair market value on the date of the grant. The Company did not grant stock option awards during either of the six-month periods ended June 30, 2015 and 2014. The following summarizes the components of share-based compensation expense by equity type for the three and six-months ended June 30: Three Months Ended Six Months Ended 2015 2014 2015 2014 Service-based Restricted Common Stock $ 49,800 $ 22,649 $ 99,600 $ 80,533 Performance-based Restricted Common Stock 6,128 — 12,256 — Performance-based Stock Options 30,035 — 60,070 — Total Share-Based Compensation Expense $ 85,963 $ 22,649 $ 171,926 $ 80,533 Stock-based compensation for the three and six-months ended June 30, 2015 and 2014 is included in general and administrative expenses in the accompanying condensed consolidated statement of operations. Restricted Common Stock Awards: In June 2015, the Company granted 100,000 shares of restricted common stock to certain non-employee directors of the Company under the 2012 Plan. The shares were granted at a price of $2.22 per share and will fully vest on the date of the Company’s next annual shareholders meeting to be held in June 2016 (assuming continued service through such date), or a vesting period of approximately one year. The total compensation expense to be recognized over the vesting period is $222,000. A summary of the status of the Company’s non-vested restricted common stock, as granted under the Company’s approved stock compensation plans, as of June 30, 2015, and changes during the six-months ended June 30, 2015, are presented below: Weighted Average Grant Date Non-vested Restricted Shares Number of Shares Fair Value Non-vested at January 1, 2015 180,000 $ 2.09 Granted 100,000 $ 2.22 Forfeited — — Vested (80,000 ) $ 2.49 Non-vested at June 30, 2015 200,000 $ 2.00 Under the terms of the performance-based restricted common stock award agreements (for the 100,000 awards granted in 2013), the awards will fully vest and become exercisable on the date on which the Company’s Board of Directors shall have determined that specific financial milestones have been met, provided the employee remains in the employ of the Company at such time; provided, however, upon a Change in Control (as defined in the award agreements and the 2012 Plan), the restricted stock shall automatically vest as permitted by the 2012 Plan. The Company’s Board of Directors adopted specific revenue and earnings performance targets as vesting conditions. During the first quarter of 2015, management determined the performance conditions related to these restricted stock awards are probable to be achieved by the year ending 2020. As a result, the Company adjusted the amortization of the fair market value of these awards over the revised implicit service period from December 2017 to December 2020. If management determines in future periods the achievement of performance conditions are probable to occur sooner than expected, the Company will accelerate the expensing of any unamortized balance as of that determination date. As of June 30, 2015, the unearned compensation related to Company granted restricted common stock was $356,792 of which $222,000 (pertaining to 100,000 service-based restricted common stock awards) will be amortized on a straight-line basis through the date of the Company’s next annual shareholders meeting scheduled to be held in June 2016, the vesting date. The remaining balance of $134,792 (pertaining to 100,000 performance-based restricted common stock awards issued in 2013) will be amortized on a straight-line basis through December 31, 2020, the revised implicit service period. Performance-Based Stock Option Awards: A summary of performance-based stock option activity, and related information for the six-months ended June 30, 2015 follows: Weighted Average Options Exercise Price Outstanding, January 1, 2015 2,070,000 $ 1.33 Granted — — Exercised (30,000 ) $ 0.78 Forfeited — — Expired — — Outstanding, June 30, 2015 2,040,000 $ 1.34 Options exercisable: June 30, 2015 1,090,000 $ 0.96 The aggregate intrinsic value of performance-based stock options outstanding (regardless of whether or not such options are exercisable) as of June 30, 2015 and December 31, 2014 was $1,716,850 and $2,792,690, respectively. The aggregate intrinsic value of performance-based stock options exercisable as of June 30, 2015 and December 31, 2014 was $1,336,850 and $1,882,550, respectively. Under the terms of the performance-based stock option agreements, the awards will fully vest and become exercisable on the date on which the Company’s Board of Directors shall have determined that specific financial performance milestones have been met, provided the employee remains in the employ of the Company at such time; provided, however, upon a Change in Control (as defined in the stock option agreements and the 2012 Plan), the stock options shall automatically vest as permitted by the 2012 Plan. During the first quarter of 2015, management determined the performance conditions related to these stock option awards are probable to be achieved by the year ending 2020. As a result, the Company adjusted the amortization of the fair market value of these awards over the revised implicit service period from December 2017 to December 2020. If management determines in future periods the achievement of performance conditions are probable to occur sooner than expected, the Company will accelerate the expensing of any unamortized balance as of that determination date. As of June 30, 2015, the unearned compensation related to the 950,000 performance-based stock options granted in August 2013 (weighted average per share exercise price of $1.77) is $660,774, which will be amortized on a straight-line basis through December 31, 2020, the implicit service period. The Company’s performance-based stock options granted prior to 2013 (consisting of 1,090,000 options) are fully amortized. Service-Based Stock Option Awards: A summary of service-based stock option activity, and related information for the six-months ended June 30, 2015 follows: Weighted Average Options Exercise Price Outstanding, January 1, 2015 522,000 $ 2.51 Granted — — Exercised — — Forfeited — — Expired (24,000 ) $ 2.55 Outstanding, June 30, 2015 498,000 $ 2.51 Options exercisable: June 30, 2015 498,000 $ 2.51 The aggregate intrinsic value of service-based stock options exercisable as of June 30, 2015 and December 31, 2014 was $0 and $102,640, respectively. At June 30, 2015, the Company’s service-based stock options are fully amortized. |
SEGMENT INFORMATION
SEGMENT INFORMATION | 6 Months Ended |
Jun. 30, 2015 | |
Segment Reporting [Abstract] | |
Segment Reporting Disclosure [Text Block] | NOTE 8 – SEGMENT INFORMATION The operating businesses of the Company are segregated into two reportable segments: (i) network solutions; and (ii) test and measurement. The network solutions segment is comprised primarily of the operations of Wireless Telecom Group Inc.’s subsidiary, Microlab. The test and measurement segment is comprised primarily of the operations of Wireless Telecom Group, Inc. which operates the Noisecom product line and the operations of its subsidiary, Boonton. The accounting policies of the reportable segments are the same as those described in the summary of significant accounting policies. The Company allocates resources and evaluates the performance of segments based on income or loss from operations, excluding interest, corporate expenses and other income (expenses). Financial information by reportable segment for the three and six-months ended June 30, 2015 and 2014: Three Months Ended Six Months Ended 2015 2014 2015 2014 Net sales by segment: Network solutions $ 5,331,327 $ 7,601,813 $ 11,226,486 $ 13,991,671 Test and measurement 2,881,970 2,837,103 5,614,502 5,632,576 Total consolidated net sales of reportable segments $ 8,213,297 $ 10,438,916 $ 16,840,988 $ 19,624,247 Segment income (loss): Network solutions $ 723,556 $ 2,197,081 $ 1,694.947 $ 3,712,666 Test and measurement 137,748 (8,279 ) 354,212 216,747 Income from reportable segments 861,304 2,188,802 2,049,159 3,929,413 Other unallocated amounts: Corporate expenses (713,410 ) (920,425 ) (1,562,538 ) (1,858,987 ) Other income (expense) - net (300 ) (7,490 ) 2,966 (37,829 ) Consolidated income before income tax provision $ 147,594 $ 1,260,887 $ 489,587 $ 2,032,597 Depreciation and amortization by segment: Network solutions $ 55,069 $ 40,845 $ 106,130 $ 75,114 Test and measurement 59,502 77,332 117,625 161,694 Total depreciation and amortization for reportable segments $ 114,571 $ 118,177 $223,755 $ 236,808 Capital expenditures by segment: Network solutions $ 30,841 $ 92,734 $ 175,598 $ 162,691 Test and measurement 3,040 3,758 105,119 34,263 Total consolidated capital expenditures by reportable segment $ 33,881 $ 96,492 $ 280,717 $ 196,954 Financial information by reportable segment as of June 30, 2015 and December 31, 2014: 2015 2014 Total assets by segment: Network solutions $ 11,655,322 $ 11,088,332 Test and measurement 7,425,617 7,006,853 Total assets for reportable segments 19,080,939 18,095,185 Corporate assets, principally cash and cash equivalents and deferred and current taxes 17,064,297 18,193,737 Total consolidated assets $ 36,145,236 $ 36,288,922 Net consolidated sales by region were as follows: Three Months Ended Six Months Ended Sales by region 2015 2014 2015 2014 Americas $ 6,155,218 $ 8,059,115 $ 12,621,854 $ 15,103,189 Europe, Middle East, Africa (EMEA) 1,559,426 1,864,904 3,295,268 3,385,900 Asia Pacific (APAC) 498,653 514,897 923,866 1,135,158 Total Sales $ 8,213,297 $ 10,438,916 $ 16,840,988 $ 19,624,247 Net sales are attributable to a geographic area based on the destination of the product shipment. The majority of shipments in the Americas are to customers located within the United States. For the three-months ended June 30, 2015 and 2014, sales in the United States for all reportable segments amounted to $5,614,787 and $7,429,777, respectively. For the six-months ended June 30, 2015 and 2014, sales in the United States for all reportable segments amounted to $11,407,261 and $14,048,676, respectively. Shipments to the EMEA region were largely concentrated in two countries, Israel and Germany. For the three-months ended June 30, 2015, sales to Israel and Germany for all reportable segments amounted to $364,921 and $194,708 of all shipments to the EMEA region, respectively. For the three-months ended June 30, 2014, sales to Israel and Germany for all reportable segments amounted to $622,482 and $441,557, respectively of all shipments to the EMEA region. For the six-months ended June 30, 2015, sales to Israel and Germany amounted to $908,315 and $661,552 of all the shipments to the EMEA region, respectively. For the six-months ended June 30, 2014, sales to Israel and Germany amounted to $622,842 and $742,687, respectively of all shipments to the EMEA region. Shipments to the APAC region were largely concentrated in China. For the three-months ended June 30, 2015 and 2014, sales in China for all reportable segments amounted to $328,747 and $837,553, respectively. For the six-months ended June 30, 2015 and 2014, sales in China for all reportable segments amounted to $597,329 and $1,105,082, respectively. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 6 Months Ended |
Jun. 30, 2015 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies Disclosure [Text Block] | NOTE 9 - COMMITMENTS AND CONTINGENCIES Warranties: The Company typically provides one-year warranties on all of its products covering both parts and labor. The Company, at its option, repairs or replaces products that are defective during the warranty period if the proper preventive maintenance procedures have been followed by its customers. Historically, the Company’s warranty expense has been minimal. Leases: In May 2015, the Company and its landlord entered into a lease agreement to remain at its principal corporate headquarters in Hanover Township, Parsippany, New Jersey through March 31, 2023. Monthly lease payments range from approximately $33,000 in year one to approximately $41,000 in year eight. Additionally, the Company has available an allowance of approximately $300,000 towards alterations and improvements to the premises through November 30, 2016. The lease can be renewed at the Company’s option for one five-year period at fair market value to be determined at term expiration. Table of Contractual Obligations Payments by Period Less than More than Total 1 Year 1-3 Years 4-5- Years 5 Years Facility Leases $ 3,455,854 $ 402,874 $ 842,369 $ 893,670 $ 1,316,941 Operating and Equipment Leases 217,899 63,775 154,124 — — $ 3,673,753 $ 466,649 $ 996,493 $ 893,670 $ 1,316,941 Environmental Contingencies: In 1982, the Company and the New Jersey Department of Environmental Protection (the “NJDEP”) agreed upon a plan to correct ground water contamination at a site, formally leased by Boonton, located in the township of Parsippany-Troy Hills, pursuant to which wells have been installed by the Company. The plan contemplates that the wells will be operated and that soil and water samples will be taken and analyzed until such time that contamination levels are satisfactory to the NJDEP. In 2014, the Company received approval for a groundwater permit from the NJDEP to carry out the final Remedial Action Work Plan and report. Under the final phase of the Remedial Action Work Plan, there will be limited and reduced monitoring and testing as long as concentrations at the site continue on a decreasing trend. While management anticipates that the expenditures in connection with this site will not be substantial in future years, the Company could be subject to significant future liabilities and may incur significant future expenditures if further contaminants from Boonton’s testing are identified and the NJDEP requires additional remediation activities. Management is unable to estimate future remediation costs, if any, at this time. The Company will continue to be liable under the plan, in all future years, until such time as the NJDEP releases it from all obligations applicable thereto. At this time, the Company believes that it is in material compliance with all environmental laws, does not anticipate any material expenditure to meet current or pending environmental requirements, and generally believes that its processes and products do not present any unusual environmental concerns. Besides the matter referred to above with the NJDEP, the Company is unaware of any existing, pending or threatened contingent liability that may have a material adverse affect on its ongoing business operations. Line of Credit: The Company maintains a line of credit with a bank. The credit facility provides borrowing availability of up to 100% of the Company’s money market account balance and 99% of the Company’s short-term investment securities (U.S. Treasury bills) and, under the terms and conditions of the loan agreement, the facility is fully secured by the Company’s money fund account and short-term investment holdings held with the bank. Advances under the facility will bear interest at a variable rate equal to the London InterBank Offered Rate (“LIBOR”) in effect at the time of borrowing. Additionally, under the terms and conditions of the loan agreement, there is 0 annual fee and any amount outstanding under the loan facility may be paid at any time in whole or in part without penalty. As of June 30, 2015, the Company had 0 borrowings outstanding under the facility and approximately $4,500,000 of borrowing availability. The Company has no current plans to borrow from this credit facility as it believes its present cash balances will adequately meet near-term working capital requirements. Risks and Uncertainties: Proprietary information and know-how are important to the Company’s commercial success. There can be no assurance that others will not either develop independently the same or similar information or obtain and use proprietary information of the Company. Certain key employees have signed confidentiality and non-compete agreements regarding the Company’s proprietary information. The Company believes that its products do not infringe the proprietary rights of third parties. There can be no assurance, however, that third parties will not assert infringement claims in the future. |
Accounting Policies, by Policy
Accounting Policies, by Policy (Policies) | 6 Months Ended |
Jun. 30, 2015 | |
Accounting Policies [Abstract] | |
New Accounting Pronouncements, Policy [Policy Text Block] | In June 2014, the FASB issued ASU 2014-12, Compensation-Stock Compensation (Topic 718): Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved after the Requisite Service Period - Consensus of the FASB Emerging Issues Task Force In May 2014, the FASB issued ASU 2014-09 “Revenue from Contracts with Customers” (Topic 606) (“ASU 2014-09”). ASU 2014-09 is a comprehensive new revenue recognition model requiring a company to recognize revenue to depict the transfer of goods or services to a customer at an amount reflecting the consideration it expects to receive in exchange for those goods or services. In July 2015, the FASB deferred the effective date for annual reporting periods beginning after December 15, 2017 (including interim reporting periods within those periods). Early adoption is permitted to the original effective date of December 15, 2016 (including interim reporting periods within those periods). The amendments may be applied retrospectively to each prior period presented or retrospectively with the cumulative effect recognized as of the date of initial application. The Company is currently in the process of evaluating the impact the adoption of ASU 2014-09 will have on the Company’s consolidated financial statements, but does not expect the impact to be material. Management does not believe that any other recently issued, but not yet effective accounting pronouncements, if adopted, would have a material impact on the accompanying condensed consolidated financial statements. |
Income Tax, Policy [Policy Text Block] | The Company records deferred taxes in accordance with Accounting Standards Codification (“ASC”) 740, “Accounting for Income Taxes.” ASC 740 requires recognition of deferred tax assets and liabilities for temporary differences between tax basis of assets and liabilities and the amounts at which they are carried in the financial statements, based upon the enacted rates in effect for the year in which the differences are expected to reverse. The Company establishes a valuation allowance when necessary to reduce deferred tax assets to the amount expected to be realized. The Company periodically assesses the value of its deferred tax assets and determines the necessity for a valuation allowance. |
Share-based Compensation, Option and Incentive Plans Policy [Policy Text Block] | The Company follows the provisions of ASC 718, “Share-Based Payment. |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Income Tax Disclosure [Abstract] | |
Schedule of Deferred Tax Assets and Liabilities [Table Text Block] | The deferred income tax assets and (liabilities) are summarized as follows: June 30, December 31, 2015 2014 Net deferred tax asset: Uniform capitalization of inventory costs for tax purposes $ 172,470 $ 168,119 Reserves on inventories 414,898 414,898 Allowance for doubtful accounts 24,246 20,568 Accruals — 240,000 Tax effect of goodwill (489,505 ) (471,487 ) Book depreciation over tax (11,329 ) (17,699 ) Net operating loss carryforward 14,041,308 13,947,384 14,152,088 14,301,783 Valuation allowance for deferred tax assets (7,012,134 ) (7,012,134 ) $ 7,139,954 $ 7,289,649 |
Schedule of Components of Income Tax Expense (Benefit) [Table Text Block] | The components of income tax expense related to income from operations are as follows: Three Months Ended Six Months Ended June 30, Jun 30, 2015 2014 2015 2014 Current: Federal $ 2,826 $ 17,062 $ 17,457 $ 33,805 State 13,292 116,825 44,576 187,190 Deferred: Federal 41,442 350,234 134,717 571,025 State 6,029 60,853 14,978 84,687 $ 63,589 $ 544,974 $ 211,728 $ 876,707 |
INCOME PER COMMON SHARE (Tables
INCOME PER COMMON SHARE (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Earnings Per Share [Abstract] | |
Schedule of Weighted Average Number of Shares [Table Text Block] | Three Months Ended Six Months Ended 2015 2014 2015 2014 Weighted average common shares outstanding 19,524,258 19,731,302 19,510,434 21,870,382 Potentially dilutive stock options 834,984 1,108,511 1,045,116 1,262,150 Weighted average common shares outstanding, assuming dilution 20,359,242 20,839,813 20,555,550 23,132,532 |
INVENTORIES (Tables)
INVENTORIES (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventory, Current [Table Text Block] | Inventories consist of: June 30, December 31, 2015 2014 Inventories consist of: Raw materials $ 4,403,459 $ 4,161,734 Work-in-process 788,160 735,364 Finished goods 3,873,466 3,643,979 $ 9,065,085 $ 8,541,077 |
ACCOUNTING FOR SHARE BASED CO21
ACCOUNTING FOR SHARE BASED COMPENSATION (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
ACCOUNTING FOR SHARE BASED COMPENSATION (Tables) [Line Items] | |
Schedule of Compensation Cost for Share-based Payment Arrangements, Allocation of Share-based Compensation Costs by Plan [Table Text Block] | The following summarizes the components of share-based compensation expense by equity type for the three and six-months ended June 30: Three Months Ended Six Months Ended 2015 2014 2015 2014 Service-based Restricted Common Stock $ 49,800 $ 22,649 $ 99,600 $ 80,533 Performance-based Restricted Common Stock 6,128 — 12,256 — Performance-based Stock Options 30,035 — 60,070 — Total Share-Based Compensation Expense $ 85,963 $ 22,649 $ 171,926 $ 80,533 |
Schedule of Nonvested Restricted Stock Units Activity [Table Text Block] | A summary of the status of the Company’s non-vested restricted common stock, as granted under the Company’s approved stock compensation plans, as of June 30, 2015, and changes during the six-months ended June 30, 2015, are presented below: Weighted Average Grant Date Non-vested Restricted Shares Number of Shares Fair Value Non-vested at January 1, 2015 180,000 $ 2.09 Granted 100,000 $ 2.22 Forfeited — — Vested (80,000 ) $ 2.49 Non-vested at June 30, 2015 200,000 $ 2.00 |
Performance Based Stock Options [Member] | |
ACCOUNTING FOR SHARE BASED COMPENSATION (Tables) [Line Items] | |
Schedule of Share-based Compensation, Stock Options, Activity [Table Text Block] | A summary of performance-based stock option activity, and related information for the six-months ended June 30, 2015 follows: Weighted Average Options Exercise Price Outstanding, January 1, 2015 2,070,000 $ 1.33 Granted — — Exercised (30,000 ) $ 0.78 Forfeited — — Expired — — Outstanding, June 30, 2015 2,040,000 $ 1.34 Options exercisable: June 30, 2015 1,090,000 $ 0.96 |
Service Based Stock Options [Member] | |
ACCOUNTING FOR SHARE BASED COMPENSATION (Tables) [Line Items] | |
Schedule of Share-based Compensation, Stock Options, Activity [Table Text Block] | A summary of service-based stock option activity, and related information for the six-months ended June 30, 2015 follows: Weighted Average Options Exercise Price Outstanding, January 1, 2015 522,000 $ 2.51 Granted — — Exercised — — Forfeited — — Expired (24,000 ) $ 2.55 Outstanding, June 30, 2015 498,000 $ 2.51 Options exercisable: June 30, 2015 498,000 $ 2.51 |
SEGMENT INFORMATION (Tables)
SEGMENT INFORMATION (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Segment Reporting [Abstract] | |
Schedule Of Segment Reporting Financial Information Including Total Assets By Segment [Table Text Block] | Financial information by reportable segment for the three and six-months ended June 30, 2015 and 2014: Three Months Ended Six Months Ended 2015 2014 2015 2014 Net sales by segment: Network solutions $ 5,331,327 $ 7,601,813 $ 11,226,486 $ 13,991,671 Test and measurement 2,881,970 2,837,103 5,614,502 5,632,576 Total consolidated net sales of reportable segments $ 8,213,297 $ 10,438,916 $ 16,840,988 $ 19,624,247 Segment income (loss): Network solutions $ 723,556 $ 2,197,081 $ 1,694.947 $ 3,712,666 Test and measurement 137,748 (8,279 ) 354,212 216,747 Income from reportable segments 861,304 2,188,802 2,049,159 3,929,413 Other unallocated amounts: Corporate expenses (713,410 ) (920,425 ) (1,562,538 ) (1,858,987 ) Other income (expense) - net (300 ) (7,490 ) 2,966 (37,829 ) Consolidated income before income tax provision $ 147,594 $ 1,260,887 $ 489,587 $ 2,032,597 Depreciation and amortization by segment: Network solutions $ 55,069 $ 40,845 $ 106,130 $ 75,114 Test and measurement 59,502 77,332 117,625 161,694 Total depreciation and amortization for reportable segments $ 114,571 $ 118,177 $223,755 $ 236,808 Capital expenditures by segment: Network solutions $ 30,841 $ 92,734 $ 175,598 $ 162,691 Test and measurement 3,040 3,758 105,119 34,263 Total consolidated capital expenditures by reportable segment $ 33,881 $ 96,492 $ 280,717 $ 196,954 |
Schedule Of Segment Reporting Information Total Assets By Segment [Table Text Block] | Financial information by reportable segment as of June 30, 2015 and December 31, 2014: 2015 2014 Total assets by segment: Network solutions $ 11,655,322 $ 11,088,332 Test and measurement 7,425,617 7,006,853 Total assets for reportable segments 19,080,939 18,095,185 Corporate assets, principally cash and cash equivalents and deferred and current taxes 17,064,297 18,193,737 Total consolidated assets $ 36,145,236 $ 36,288,922 |
Schedule Of Net Consolidated Sales By Region [Table Text Block] | Net consolidated sales by region were as follows: Three Months Ended Six Months Ended Sales by region 2015 2014 2015 2014 Americas $ 6,155,218 $ 8,059,115 $ 12,621,854 $ 15,103,189 Europe, Middle East, Africa (EMEA) 1,559,426 1,864,904 3,295,268 3,385,900 Asia Pacific (APAC) 498,653 514,897 923,866 1,135,158 Total Sales $ 8,213,297 $ 10,438,916 $ 16,840,988 $ 19,624,247 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Tables) | 6 Months Ended |
Jun. 30, 2015 | |
Commitments and Contingencies Disclosure [Abstract] | |
Contractual Obligation, Fiscal Year Maturity Schedule [Table Text Block] | Table of Contractual Obligations Payments by Period Less than More than Total 1 Year 1-3 Years 4-5- Years 5 Years Facility Leases $ 3,455,854 $ 402,874 $ 842,369 $ 893,670 $ 1,316,941 Operating and Equipment Leases 217,899 63,775 154,124 — — $ 3,673,753 $ 466,649 $ 996,493 $ 893,670 $ 1,316,941 |
SUMMARY OF SIGNIFICANT ACCOUN24
SUMMARY OF SIGNIFICANT ACCOUNTING PRINCIPLES AND POLICIES (Details) | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | Dec. 31, 2014 | |
SUMMARY OF SIGNIFICANT ACCOUNTING PRINCIPLES AND POLICIES (Details) [Line Items] | |||||
Number of Financial Institutions in Which Company Maintains Cash Investments | 2 | ||||
Number of significant customer respect to revenue | 0 | 1 | 0 | 1 | |
Number of Significant Customer Respect to Accounts Receivable | 0 | 0 | 1 | ||
No Customer [Member] | |||||
SUMMARY OF SIGNIFICANT ACCOUNTING PRINCIPLES AND POLICIES (Details) [Line Items] | |||||
Concentration Risk, Percentage | 10.00% | 10.00% | |||
Percentage Of Accounts Receivable Attributable To Significant Customer | 10.00% | ||||
Customer One [Member] | |||||
SUMMARY OF SIGNIFICANT ACCOUNTING PRINCIPLES AND POLICIES (Details) [Line Items] | |||||
Concentration Risk, Percentage | 13.00% | 14.00% | |||
Percentage of Gross Accounts Receivable Balance | 11.00% |
INCOME TAXES (Details)
INCOME TAXES (Details) - Jun. 30, 2015 - USD ($) | Total |
INCOME TAXES (Details) [Line Items] | |
Operating Loss Carryforwards Expiration Period | 2,029 |
Percentage of Largest Benefit to Tax Benefits Recognized | 50.00% |
Domestic Tax Authority [Member] | |
INCOME TAXES (Details) [Line Items] | |
Operating Loss Carryforwards | $ 17,000,000 |
Foreign Tax Authority [Member] | |
INCOME TAXES (Details) [Line Items] | |
Operating Loss Carryforwards | 23,400,000 |
Operating Loss Carryforwards, Valuation Allowance | $ 7,012,134 |
INCOME TAXES (Details) - Schedu
INCOME TAXES (Details) - Schedule of deferred tax assets and liabilities - USD ($) | Jun. 30, 2015 | Dec. 31, 2014 |
Net deferred tax asset: | ||
Uniform capitalization of inventory costs for tax purposes | $ 172,470 | $ 168,119 |
Reserves on inventories | 414,898 | 414,898 |
Allowance for doubtful accounts | 24,246 | 20,568 |
Accruals | 240,000 | |
Tax effect of goodwill | (489,505) | (471,487) |
Book depreciation over tax | (11,329) | (17,699) |
Net operating loss carryforward | 14,041,308 | 13,947,384 |
14,152,088 | 14,301,783 | |
Valuation allowance for deferred tax assets | (7,012,134) | (7,012,134) |
$ 7,139,954 | $ 7,289,649 |
INCOME TAXES (Details) - Sche27
INCOME TAXES (Details) - Schedule of income tax expense related to income from operations - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | |
Current: | ||||
Federal | $ 2,826 | $ 17,062 | $ 17,457 | $ 33,805 |
State | 13,292 | 116,825 | 44,576 | 187,190 |
Deferred: | ||||
Federal | 41,442 | 350,234 | 134,717 | 571,025 |
State | 6,029 | 60,853 | 14,978 | 84,687 |
$ 63,589 | $ 544,974 | $ 211,728 | $ 876,707 |
INCOME PER COMMON SHARE (Detail
INCOME PER COMMON SHARE (Details) - shares | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | |
Earnings Per Share [Abstract] | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 1,727,192 | 1,729,039 | 1,522,742 | 1,596,784 |
INCOME PER COMMON SHARE (Deta29
INCOME PER COMMON SHARE (Details) - Schedule of weighted average number of shares - shares | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | |
Schedule of weighted average number of shares [Abstract] | ||||
Weighted average common shares outstanding | 19,524,258 | 19,731,302 | 19,510,434 | 21,870,382 |
Potentially dilutive stock options | 834,984 | 1,108,511 | 1,045,116 | 1,262,150 |
Weighted average common shares outstanding, assuming dilution | 20,359,242 | 20,839,813 | 20,555,550 | 23,132,532 |
INVENTORIES (Details)
INVENTORIES (Details) - USD ($) | Jun. 30, 2015 | Dec. 31, 2014 |
Inventory Disclosure [Abstract] | ||
Inventory Valuation Reserves | $ 1,037,247 | $ 1,037,247 |
INVENTORIES (Details) - Schedul
INVENTORIES (Details) - Schedule of inventory current - USD ($) | Jun. 30, 2015 | Dec. 31, 2014 |
Inventories consist of: | ||
Raw materials | $ 4,403,459 | $ 4,161,734 |
Work-in-process | 788,160 | 735,364 |
Finished goods | 3,873,466 | 3,643,979 |
$ 9,065,085 | $ 8,541,077 |
GOODWILL (Details)
GOODWILL (Details) - USD ($) | Jun. 30, 2015 | Dec. 31, 2014 |
GOODWILL (Details) [Line Items] | ||
Goodwill | $ 1,351,392 | $ 1,351,392 |
Microlab [Member] | ||
GOODWILL (Details) [Line Items] | ||
Goodwill | $ 1,351,392 | $ 1,351,392 |
ACCOUNTING FOR SHARE BASED CO33
ACCOUNTING FOR SHARE BASED COMPENSATION (Details) - USD ($) | 1 Months Ended | 3 Months Ended | 6 Months Ended | |||||
Jun. 30, 2015 | Aug. 31, 2013 | Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2013 | Dec. 31, 2014 | |
ACCOUNTING FOR SHARE BASED COMPENSATION (Details) [Line Items] | ||||||||
Share-based Compensation | $ 85,963 | $ 22,649 | $ 171,926 | $ 80,533 | ||||
Stock or Units Available for Distributions (in Shares) | 2,000,000 | |||||||
Share Based Compensation Arrangement By Share Based Payment Award Additional Number of Share Available for Grant (in Shares) | 1,658,045 | 1,658,045 | ||||||
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Available for Grant (in Shares) | 2,169,000 | 2,169,000 | 2,169,000 | |||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period | 10 years | |||||||
Share Based Compensation Arrangement by Share Based Payment Award Maximum Period Consider for Option Fully Exercisable | 5 years | |||||||
Allocated Share-based Compensation Expense | $ 85,963 | $ 22,649 | $ 171,926 | $ 80,533 | ||||
Performance Shares [Member] | ||||||||
ACCOUNTING FOR SHARE BASED COMPENSATION (Details) [Line Items] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period | 10 years | |||||||
Allocated Share-based Compensation Expense | 30,035 | $ 60,070 | ||||||
Restricted Stock [Member] | ||||||||
ACCOUNTING FOR SHARE BASED COMPENSATION (Details) [Line Items] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period | 1 year | |||||||
Share-based Compensation Arrangement by Share-based Payment Award, Non-Option Equity Instruments, Granted (in Shares) | 100,000 | |||||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period, Weighted Average Grant Date Fair Value (in Dollars per share) | $ 2.22 | $ 2.22 | ||||||
Allocated Share-based Compensation Expense | $ 222,000 | 49,800 | $ 22,649 | $ 99,600 | $ 80,533 | |||
Adjustments to Additional Paid in Capital, Share-based Compensation, Restricted Stock Unit or Restricted Stock Award, Requisite Service Period Recognition | 356,792 | |||||||
Stock Based Compensation to be Amortized Next Fiscal Year | 222,000 | 222,000 | $ 222,000 | |||||
Stock Based Compensation to be Amortized Vesting Period | June 2,016 | |||||||
Stock Based Compensation to be Amortized Depending on Certain Performance Conditions | 134,792 | 134,792 | $ 134,792 | |||||
Performance Based Stock Options [Member] | ||||||||
ACCOUNTING FOR SHARE BASED COMPENSATION (Details) [Line Items] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Non-Option Equity Instruments, Granted (in Shares) | 100,000 | |||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested and Expected to Vest, Outstanding, Aggregate Intrinsic Value | 1,716,850 | 1,716,850 | $ 1,716,850 | $ 2,792,690 | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested and Expected to Vest, Exercisable, Aggregate Intrinsic Value | 1,336,850 | 1,336,850 | 1,336,850 | 1,882,550 | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross (in Shares) | 950,000 | |||||||
Share-based Compensation Arrangements by Share-based Payment Award, Options, Grants in Period, Weighted Average Exercise Price (in Dollars per share) | $ 1.77 | |||||||
Employee Service Share-based Compensation, Nonvested Awards, Compensation Not yet Recognized, Stock Options | 660,774 | 660,774 | 660,774 | |||||
Stock Granted, Value, Share-based Compensation, Gross | $ 1,090,000 | |||||||
Service Based Stock Options [Member] | ||||||||
ACCOUNTING FOR SHARE BASED COMPENSATION (Details) [Line Items] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested and Expected to Vest, Exercisable, Aggregate Intrinsic Value | $ 0 | $ 0 | $ 0 | $ 102,640 |
ACCOUNTING FOR SHARE BASED CO34
ACCOUNTING FOR SHARE BASED COMPENSATION (Details) - Schedule of share-based compensation expense, components by equity type - USD ($) | 1 Months Ended | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | |
ACCOUNTING FOR SHARE BASED COMPENSATION (Details) - Schedule of share-based compensation expense, components by equity type [Line Items] | |||||
Share Based Compensation | $ 85,963 | $ 22,649 | $ 171,926 | $ 80,533 | |
Restricted Stock [Member] | |||||
ACCOUNTING FOR SHARE BASED COMPENSATION (Details) - Schedule of share-based compensation expense, components by equity type [Line Items] | |||||
Share Based Compensation | $ 222,000 | 49,800 | $ 22,649 | 99,600 | $ 80,533 |
Performance Based Restricted Common Stock [Member] | |||||
ACCOUNTING FOR SHARE BASED COMPENSATION (Details) - Schedule of share-based compensation expense, components by equity type [Line Items] | |||||
Share Based Compensation | 6,128 | 12,256 | |||
Performance Shares [Member] | |||||
ACCOUNTING FOR SHARE BASED COMPENSATION (Details) - Schedule of share-based compensation expense, components by equity type [Line Items] | |||||
Share Based Compensation | $ 30,035 | $ 60,070 |
ACCOUNTING FOR SHARE BASED CO35
ACCOUNTING FOR SHARE BASED COMPENSATION (Details) - Schedule of non-vested restricted stock activity - Jun. 30, 2015 - Restricted Stock [Member] - $ / shares | Total | Total |
ACCOUNTING FOR SHARE BASED COMPENSATION (Details) - Schedule of non-vested restricted stock activity [Line Items] | ||
Non-vested at January 1, 2015 | 180,000 | |
Non-vested at January 1, 2015 | $ 2.09 | |
Granted | 100,000 | |
Granted | $ 2.22 | $ 2.22 |
Vested | (80,000) | |
Vested | $ 2.49 | |
Non-vested at June 30, 2015 | 200,000 | 200,000 |
Non-vested at June 30, 2015 | $ 2 | $ 2 |
ACCOUNTING FOR SHARE BASED CO36
ACCOUNTING FOR SHARE BASED COMPENSATION (Details) - Schedule of performance-based stock option activity, and related Information - 6 months ended Jun. 30, 2015 - Performance Based Stock Options [Member] - $ / shares | Total |
ACCOUNTING FOR SHARE BASED COMPENSATION (Details) - Schedule of performance-based stock option activity, and related Information [Line Items] | |
Outstanding, January 1, 2015 | 2,070,000 |
Outstanding, January 1, 2015 | $ 1.33 |
Exercised | (30,000) |
Exercised | $ 0.78 |
Outstanding, June 30, 2015 | 2,040,000 |
Outstanding, June 30, 2015 | $ 1.34 |
Options exercisable: | |
June 30, 2015 | 1,090,000 |
June 30, 2015 | $ 0.96 |
ACCOUNTING FOR SHARE BASED CO37
ACCOUNTING FOR SHARE BASED COMPENSATION (Details) - Schedule of service-based stock option activity, and related Information - 6 months ended Jun. 30, 2015 - Service Based Stock Options [Member] - $ / shares | Total |
ACCOUNTING FOR SHARE BASED COMPENSATION (Details) - Schedule of service-based stock option activity, and related Information [Line Items] | |
Outstanding, January 1, 2015 | 522,000 |
Outstanding, January 1, 2015 | $ 2.51 |
Expired | (24,000) |
Expired | $ 2.55 |
Outstanding, June 30, 2015 | 498,000 |
Outstanding, June 30, 2015 | $ 2.51 |
Options exercisable: | |
June 30, 2015 | 498,000 |
June 30, 2015 | $ 2.51 |
SEGMENT INFORMATION (Details)
SEGMENT INFORMATION (Details) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2015USD ($) | Jun. 30, 2014USD ($) | Jun. 30, 2015USD ($) | Jun. 30, 2014USD ($) | |
SEGMENT INFORMATION (Details) [Line Items] | ||||
Number of Reportable Segments | 2 | |||
United States [Member] | ||||
SEGMENT INFORMATION (Details) [Line Items] | ||||
Revenue, Net | $ 5,614,787 | $ 7,429,777 | $ 11,407,261 | $ 14,048,676 |
Israel [Member] | ||||
SEGMENT INFORMATION (Details) [Line Items] | ||||
Revenue, Net | 364,921 | 622,482 | 908,315 | 622,842 |
Germany [Member] | ||||
SEGMENT INFORMATION (Details) [Line Items] | ||||
Revenue, Net | 194,708 | 441,557 | 661,552 | 742,687 |
China [Member] | ||||
SEGMENT INFORMATION (Details) [Line Items] | ||||
Revenue, Net | $ 328,747 | $ 837,553 | $ 597,329 | $ 1,105,082 |
SEGMENT INFORMATION (Details) -
SEGMENT INFORMATION (Details) - Schedule of segment reporting financial information including total assets by segment - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | |
Net sales by segment: | ||||
Net sales by segment | $ 8,213,297 | $ 10,438,916 | $ 16,840,988 | $ 19,624,247 |
Segment income (loss): | ||||
Segment income | 861,304 | 2,188,802 | 2,049,159 | 3,929,413 |
Other unallocated amounts: | ||||
Corporate expenses | (713,410) | (920,425) | (1,562,538) | (1,858,987) |
Other income (expense) - net | (300) | (7,490) | 2,966 | (37,829) |
Consolidated income before income tax provision | 147,594 | 1,260,887 | 489,587 | 2,032,597 |
Depreciation and amortization by segment: | ||||
Depreciation by segment | 114,571 | 118,177 | 223,755 | 236,808 |
Capital expenditures by segment: | ||||
Capital expenditures by segment | 33,881 | 96,492 | 280,717 | 196,954 |
Network Solutions [Member] | ||||
Net sales by segment: | ||||
Net sales by segment | 5,331,327 | 7,601,813 | 11,226,486 | 13,991,671 |
Segment income (loss): | ||||
Segment income | 723,556 | 2,197,081 | 1,694.947 | 3,712,666 |
Depreciation and amortization by segment: | ||||
Depreciation by segment | 55,069 | 40,845 | 106,130 | 75,114 |
Capital expenditures by segment: | ||||
Capital expenditures by segment | 30,841 | 92,734 | 175,598 | 162,691 |
Test and Measurement [Member] | ||||
Net sales by segment: | ||||
Net sales by segment | 2,881,970 | 2,837,103 | 5,614,502 | 5,632,576 |
Segment income (loss): | ||||
Segment income | 137,748 | (8,279) | 354,212 | 216,747 |
Depreciation and amortization by segment: | ||||
Depreciation by segment | 59,502 | 77,332 | 117,625 | 161,694 |
Capital expenditures by segment: | ||||
Capital expenditures by segment | $ 3,040 | $ 3,758 | $ 105,119 | $ 34,263 |
SEGMENT INFORMATION (Details)40
SEGMENT INFORMATION (Details) - Schedule of segment reporting information total assets by segment - USD ($) | Jun. 30, 2015 | Dec. 31, 2014 |
Total assets by segment: | ||
Total assets by segment | $ 19,080,939 | $ 18,095,185 |
Corporate assets, principally cash and cash equivalents and deferred and current taxes | 17,064,297 | 18,193,737 |
Total consolidated assets | 36,145,236 | 36,288,922 |
Network Solutions [Member] | ||
Total assets by segment: | ||
Total assets by segment | 11,655,322 | 11,088,332 |
Test and Measurement [Member] | ||
Total assets by segment: | ||
Total assets by segment | $ 7,425,617 | $ 7,006,853 |
SEGMENT INFORMATION (Details)41
SEGMENT INFORMATION (Details) - Schedule of net consolidated sales from operations by region - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | |
SEGMENT INFORMATION (Details) - Schedule of net consolidated sales from operations by region [Line Items] | ||||
Revenues | $ 8,213,297 | $ 10,438,916 | $ 16,840,988 | $ 19,624,247 |
Americas [Member] | ||||
SEGMENT INFORMATION (Details) - Schedule of net consolidated sales from operations by region [Line Items] | ||||
Revenues | 6,155,218 | 8,059,115 | 12,621,854 | 15,103,189 |
Europe, Middle East, Africa [Member] | ||||
SEGMENT INFORMATION (Details) - Schedule of net consolidated sales from operations by region [Line Items] | ||||
Revenues | 1,559,426 | 1,864,904 | 3,295,268 | 3,385,900 |
Asia Pacific [Member] | ||||
SEGMENT INFORMATION (Details) - Schedule of net consolidated sales from operations by region [Line Items] | ||||
Revenues | $ 498,653 | $ 514,897 | $ 923,866 | $ 1,135,158 |
COMMITMENTS AND CONTINGENCIES42
COMMITMENTS AND CONTINGENCIES (Details) - Jun. 30, 2015 | USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
Warranties Period of Product | 1 year |
Lease Expiration Date | Mar. 31, 2023 |
Monthly Leases Minimum Payments Due in Year One | $ 33,000 |
Monthly Leases Maximum Payments Due in Year Eight | 41,000 |
Allowance Received for Improvement | $ 300,000 |
Description of Lessor Leasing Arrangements, Operating Leases | The lease can be renewed at the Company’s option for one five-year period at fair market value to be determined at term expiration. |
Lease Renewal Option | 1 |
Lease Renewable Term | 5 years |
Line of Credit Facility, Borrowing Capacity, Description | The Company maintains a line of credit with a bank. The credit facility provides borrowing availability of up to 100% of the Company’s money market account balance and 99% of the Company’s short-term investment securities (U.S. Treasury bills) and, under the terms and conditions of the loan agreement, the facility is fully secured by the Company’s money fund account and short-term investment holdings held with the bank. |
Line of Credit Availability Equal to Percent of Money Market Account | 100.00% |
Line of Credit Availability Equal to Percent of Short-term Investment | 99.00% |
Line Of Credit Annual Fees Amount | $ 0 |
Long-term Line of Credit | 0 |
Line of Credit Facility, Maximum Borrowing Capacity | $ 4,500,000 |
COMMITMENTS AND CONTINGENCIES43
COMMITMENTS AND CONTINGENCIES (Details) - Schedule of contractual obligations | Jun. 30, 2015USD ($) |
COMMITMENTS AND CONTINGENCIES (Details) - Schedule of contractual obligations [Line Items] | |
Contractual Obligations, Total | $ 3,673,753 |
Contractual Obligations, Less than 1 Year | 466,649 |
Contractual Obligations, 1-3 Years | 996,493 |
Contractual Obligations, 4-5 Years | 893,670 |
Contractual Obligations, More than 5 Years | 1,316,941 |
Facility Leases [Member] | |
COMMITMENTS AND CONTINGENCIES (Details) - Schedule of contractual obligations [Line Items] | |
Contractual Obligations, Total | 3,455,854 |
Contractual Obligations, Less than 1 Year | 402,874 |
Contractual Obligations, 1-3 Years | 842,369 |
Contractual Obligations, 4-5 Years | 893,670 |
Contractual Obligations, More than 5 Years | 1,316,941 |
Operating and Equipment Leases [Member] | |
COMMITMENTS AND CONTINGENCIES (Details) - Schedule of contractual obligations [Line Items] | |
Contractual Obligations, Total | 217,899 |
Contractual Obligations, Less than 1 Year | 63,775 |
Contractual Obligations, 1-3 Years | $ 154,124 |